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Goals & Strategy
The Company's principle objectives are to pay out a substantial portion of its FFO in the form of quarterly dividends and to increase its earnings and dividends per share through organic and accretive growth. Key elements of our strategy to achieve these objectives include:
Continue to increase returns from current portfolio
We plan to continue to increase returns from our current portfolio while maintaining or improving tenant stability and their quality of accommodation.
Increase profitability through operating efficiencies
Our size, geographic footprint and centralized corporate infrastructure should enable us to achieve significant ongoing cost savings upon the integration of new portfolios into our operational infrastructure. We intend to reduce general and administrative expenses of our Group by optimizing cost saving initiatives successfully implemented at the GAGFAH GmbH and NILEG GmbH Groups and through the replication of these cost saving initiatives at the WOBA GmbH Group and new acquisitions. In addition, we expect to achieve further cost reductions with regard to repairs, maintenance and capital expenditure by taking advantage of our purchasing power resulting from our size and centralized purchasing function and through continuous active cost management and review.
Accretively grow our residential real estate portfolio in Germany
We plan to take advantage of the trend of cities, municipalities and corporations selling their residential housing stock by targeting both smaller-sized as well as large portfolio acquisitions in Germany. We will pursue acquisitions which will be earnings accretive and our acquisition strategy will continue to focus on reasonably priced residential portfolios where we can improve cash flow and earnings through integration and realization of synergies.
Add incremental earnings through reinvestment of privatization proceeds
We will selectively sell individual apartments to current tenants and reinvest the proceeds in new apartments where deemed economically advantageous, i.e., where the privatization of units and reinvestment of the proceeds generates higher returns than holding the assets and hence increases earnings per Share.
Use financial leverage to enhance our return-on-equity, our earnings per Share and our funds from operations
The stability of residential real estate as an asset class together with our access to low-cost, long-term fixed rate debt financing provides us with an attractive opportunity to use significant financial leverage to enhance our return-on-equity, our earnings per Share and our FFO per Share as the yield on our asset portfolio exceeds our cost of capital.